Mahurat Trading: Demand surge drives gold and silver to new heights – analysts predict further gains through 2025
As Samvat 2080 comes to an end, gold and silver have surged to unprecedented levels, benefiting from central bank demand, global economic shifts, and a strong appetite for safe-haven assets. The rally in these metals has been further supported by investors seeking portfolio diversification amid economic uncertainty.
Max Layton of Citi, Kunal Shah of Nirmal Bang Securities, and Chirag Sheth of MetalFocus each foresee continued strength in these commodities, projecting high price targets driven by supply deficits and heightened demand across sectors.
Max Layton, Global Head of Commodities at Citi, pointed out that gold has exhibited “very steady, positive momentum” amid rising rates and strong economic data, which have typically weighed on gold. Citi has maintained its target for gold at $3,000 per ounce since the beginning of the year, and Layton believes it could be reached in the next six months.
Layton attributes gold’s 35% rally this year to strong investment demand, notably from central banks and ETF buyers across Asia, North America, and Europe, with North American ETF demand leading in the third quarter.
Discussing silver, Layton pointed to a sustained deficit in the market, driven by industrial and investment demand that has kept inventory levels historically tight. “For the past five years, we have seen an annual deficit of 15-20% of silver’s global consumption,” he explained, emphasising that this imbalance has spurred turnover in bar and coin inventories.
Layton predicts further price gains, expecting silver to hit $40 per ounce within 6-12 months. The fundamental tightness in the silver market, coupled with a projected slowdown in the US labour market, is set to further fuel demand for the metal as a safe-haven asset, he added.
Chirag Sheth from MetalFocus echoed this optimism, particularly for silver, emphasising its growing demand for renewable energy and electric vehicles. “We expect silver prices to rise beyond $40, fueled by strong demand from sectors like solar panels and electric vehicles,” said Sheth.
With the silver market in a widening deficit, he foresees sustained bullish momentum for the metal over the next 12 to 18 months. On gold, Sheth aligned with the $3,000 target, adding that a consolidation phase may follow but that the long-term outlook remains robust.
Kunal Shah of Nirmal Bang Securities took a similar bullish stance, setting a target for gold at $3,200 per ounce. “The gold rally has plenty of legs,” Shah asserted, emphasising that the metal’s resilience over the past two decades makes it a compelling choice for investors.
For Shah, the persistent upward trend is driven by an alignment of geopolitical and economic factors, including potential Federal Reserve rate cuts or geopolitical escalations. He cautions that while minor corrections are likely, the underlying strength of gold as an investment remains intact, projecting conservative annualised returns of 10-15% over the next two years.
Watch the accompanying video for the entire conversation.